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When Lynn Peterson started as state transportation secretary a year ago she inherited two of the biggest megaprojects in Seattle history.

The Department of Transportation and its 45-year-old administrator have since come under intense scrutiny with Bertha, the tunnel-boring machine, stalled under downtown Seattle with no precise plan yet on how to fix it, and the new Highway 520 floating bridge running over budget.

The Seattle Times interviewed Peterson recently to get her take on Bertha and the prospect of finishing the Alaskan Way Viaduct replacement project without cost overruns, among other matters.

Before taking over the department, with its 6,600 employees, Peterson worked as a transportation adviser to Oregon Gov. John Kitzhaber. She served as chairwoman of the Clackamas County Board of Commissioners, and as a consultant and planning manager for TriMet, Portland’s regional transportation agency.

This is her first time running a large government agency, a job that pays $163,056.

When asked if the department’s reputation had been damaged by the recent controversies, Peterson said, “I think it is difficult to maintain that — a high level of credibility — when you’ve got high-risk situations.”

But Peterson also said she has “very high” confidence that Bertha’s problems won’t cost taxpayers additional money and that “in the end, this will seem like a small issue compared to the relative importance of the entire project.”

Here are excerpts from the conversation, with some edits for clarity:

Q: Before taking this job you were Kitzhaber’s transportation policy adviser. How did that prepare you to take over a pretty massive agency with more than 6,000-some-odd employees that is responsible for multibillion-dollar megaprojects?

A: I think it’s a combination of experiences, not just one or another. Obviously working at the state level, working with (the Oregon Department of Transportation) on issues through the governor’s office was one perspective, but my entire career, I think, has led me to this position.

Q: Was it different going from a political office, or advisory position, to running a large agency?

A: No. It’s the same level of decision-making, the same type of thought process.

Q: I ask because in the past, folks who assume this job [have had] a lot of agency experience.

A: I started my career at Wisconsin DOT.

Q: What did you do there?

A: I’m a civil engineer. I did highway design and construction. I was out in the field, I was inside doing the design. I know the basics of what our folks are doing out there because I did it myself.

Q: In terms of dealing with large megaprojects now, is there anything in your past that helped prepare you for that?

A: The majority of megaprojects, or all of them in Oregon, really, have been around the light-rail lines. And a megaproject is anything over $1 billion. So they are definitely megaprojects, I’ve worked on, or for Tri-met projects for a lot of my career.

Q: Have there been any surprises since you took over?

A: I’m pleasantly surprised at the innovative nature of WSDOT and our employees.

Q: What’s been the hardest part?

A: We have to make the assumption we’re not getting a (transportation tax package from the Legislature) package until the package passes (into law). But how do you ramp up for the possibility of a package? So, managing that uncertainty.

Q: It seems like it would be difficult to inherit megaprojects that have problems.

There are always going to be decisions that people have made prior to you coming that will either take the agency in a positive or a negative direction. It’s really how you manage through that. It’s just always going to happen. And there will be things that we do that will either put us on a positive track or create an issue for somebody else to solve in the future because there are unintended consequences to everything.

Q: Back in January you sent a letter to state lawmakers saying you have had concerns about Bertha’s “operations and critical systems” since its launch. What were those concerns?

It’s not one thing or another; it’s several different issues. It’s everything from how the machine was being run to how it was manufactured and tested.

Q: Anything that stood out to you at the time?

A: In terms of the list of things? Because I wasn’t here …

Q: In the letter you said you’ve had concerns about Bertha’s “operations and critical systems” since its launch. Give me a couple of examples.

A: How Bertha handled getting through the head wall, how she was operating or not operating for those three weeks prior to October/November … and then the work stoppage that occurred Dec. 6.

Q: Did the concerns you had early on prove prescient in the sense that they have any bearing on the difficulties it’s having now?

A: Yes, I think they do, but I think the contractor had similar concerns. We were just asking for clarification.

Q: What’s your understanding of why Bertha is stuck?

A: While I may be civil engineer, I’m no tunneling expert. I’ve got the same information you do, literally. What I can say is one, the contractor and the manufacturer are trying to determine how much of the overheating and the blowing of the seals was caused by operator error or design flaw. So between those things, they’re going to have to figure that out.

But we know about the seals being broke and we know about the possibility that they’re going to have to look at the bearings. We know that there is a question about how they pushed the machine at the end. What did that do? It’s a pressure-balancing machine. Is the pressure balancing working? So I think all of those things are possibilities.

Q: Your agency has said, “There’s been no evidence put forth by Seattle Tunnel Partners that would show that any of the cost associated with this would be borne by our agency or by the taxpayers.” I’m not exactly sure what that means.

A: This is a design-build contract. It was chosen because WSDOT is an expert in roads and bridges, not in tunnels. So we wanted the majority of expertise on the contractor side to take responsibility of the choosing of the type of machine, the design of the machine, the construction of the machine and the operation and the maintenance of the machine. So any issue that results from the machine, right, is an issue for the contractor to deal with and pay for.

Q: What kind of evidence would STP (Seattle Tunnel Partners) need to show for the state to bear some responsibility?

A: In the contracts, the only thing that the state has responsibility for is giving information about the site conditions in terms of the soil. So we’re the ones that did all the boring prework. They looked at it, they reviewed it, but we’re the ones responsible. So that’s why we have $40 million set aside in contingency, specifically for site conditions that were not what we thought they would be.

Q: So if the stuff Bertha drills through is not what the state said it would be, that’s when the state might have some responsibility?

A: That’s the big one, having not read through the entire contract, which is a three-ring binder …

Q: What level of certainty do you have that the state won’t have to pay for cost overruns?

A: Very high.

Q: 80 percent, 90 percent?

A: As the contract is written, and our understanding to date of what the issue is, it’s very high.

Q: The Expert Review Panel recently talked about a strained relationship [between WSDOT and STP]. In particular they pointed out that the tunnel contractors believe WSDOT’s “breach of contract” action damaged their reputations. What is your reaction to the ERP report? (WSDOT earlier this year declared the tunnel team in “material breach of contract” because of barriers to participation by small, minority-owned contracting firms.)

A: I don’t think any company wants to hear they had a civil-rights violation. And I think it’s a hard moment in time …

It was a very big deal, but our contract is very clear. If there is a civil-rights violation on the project it is a breach of contract. And the federal government found us in noncompliance and what does that mean? Because this is important. If we did not show that we were moving in a direction to repair the situation we could lose all federal funding for this project …

Q: Do you feel the agency’s reputation has been hurt in any way (by the megaprojects)?

A: “I think that it is difficult to maintain that — a high level of credibility — when you’ve got high-risk situations, right. What we’re trying to do is make sure we keep the faith that we’re getting the information out there, and as accurate as we can at the time, as quickly as we can, so that people understand why things are happening.

Q: The reason I ask is I cover the Legislature. A big part of the [transportation] debate this session is that WSDOT’s reputation has been hurt by what’s happening with the megaprojects. There’s discussion about the need to restore the public’s trust. Do you feel they are right in that regard?

A: I think that, again, what people have to weigh here is that, what does that mean in terms of restoring WSDOT’s credibility.

Q: But do you feel there is credibility that needs to be restored?

A: We are a credible source of information, we’re …

Q: Has your reputation been hurt, though?

A: In terms of what, though? I mean, that’s a very general statement.

Q: In terms of your ability to deliver projects of this scale?

A: We’re delivering the vast majority of [projects financed by past gas-tax increases], at 91 percent on time and on budget. So I believe that it’s about minimizing risk, and that’s what we’re trying to do as we manage through these issues …

Q: I’m not sure I completely got the answer there in terms of whether you feel your agency’s reputation has been harmed.

A: I think these are frustrating issues, not only for us, but for the public. And we are trying to do the best job managing through to minimize risks to the taxpayer.

Q: The point being the only way you can repair any reputation that’s been damaged is to complete the projects?

A: Moving forward. Complete the project because the project’s significance to this community is so big. There is so much depending on it that in the end this will seem like a small issue compared to the relative importance of this entire project.

News researcher Miyoko Wolf contributed to this report. Andrew Garber: 360-236-8268 or